By Merit Ibe
The Lagos Chamber of Commerce and Industry (LCCI) has urged President Muhammad Buhari, to urgently set up an Independent Appeal Mechanism to deal with issues of valuation and Harmonised System (HS) classification between the Nigeria Customs Service (NCS) and the business community to strengthen its weakening investor’ confidence.
The Chamber made the appeal following distressing encounters experienced by investors in the Nigerian economy, in managing disputes with the Nigeria Customs Service (NCS) on matters of product valuation and harmonised system of product classification.
Director General, Muda Yusuf, who made the remark at the weekend, noted that the situation was hurting investment and weakening investor’ confidence, adding that importers were left entirely at the mercy of the customs in the absence of a credible, independent window for dispute settlement with the private sector.
Yusuf decried the present arrangement, where the Customs Service is the accuser and the judge, saying the mechanism was unfair to investors and not consistent with the principles of natural justice. He said many companies have been compelled to pay outrageous additional charges on imports thereby distorting their investment plans and projections.
“Discretionary interpretations on product classification and valuation poses enormous corruption risks in customs processes. Indeed, the biggest corruption risks in the interface between the customs and the business community are around these two issues.”
The LCCI boss emphasised that the situation was hurting investors across all sectors – manufacturing, agro-allied, ICT, construction, services and also a disincentive to domestic and foreign investment; which creates uncertainty and aggravates investment risk, undermines economic diversification prospects, depresses capacity utilisation, and limits the scope for job creation.
“It is also not consistent with the vision to make Nigeria a top investment destination.” Calling on the president to step in, he said it could be done within the framework of an Executive Order, which he noted was necessary to restore the confidence of investors in the international trade process.
He said the reality that the Nigeria Customs Service has a weak Trade Facilitation culture and an absence of customer service orientation was hurting investment, frustrating trade, and creating a negative investment sentiment.
“A presidential intervention has become inevitable, especially with the onset of the African Continental Free Trade Area (AfCFTA).
“There is need to ensure a balance between regulatory controls, revenue generation and trade facilitation functions of the Nigerian customs service.”